Amending Federal Civil Procedure Rules To Address Problems Of Electronic Discovery

Monday, November 1, 2004 - 00:00

Judge Lee H. Rosenthal, U.S. District Court Judge in Texas and Chair of the Federal Judicial Conference Civil Rules Advisory Committee, will describe the new package of rule amendments governing discovery of electronic information at the annual meeting of the Lawyers for Civil Justice on December 14 in New York City. Registration and information about other programs in the two-day event, which starts on December 13, is available from Tierney Kraft (tkraft@lfcj.com) at (202) 429-0045.

Facing uncertainties and problems as they tackle electronic discovery under the present federal rules, many judges, trial lawyers, litigants, and computer experts have been advocating that the judiciary adopt rules that would provide clarity and guidance for handling e-discovery in the courtroom. The issue has assumed growing importance for the legal and corporate communities as storage and retrieval of electronically stored data have become more and more burdensome, costly and time consuming.

Judges expect electronic information to be produced quickly and efficiently, but companies often are confronted with vast volumes of non-indexed electronic files and disorganized emails. A major part of the problem is that employees all too frequently view email as a casual form of verbal communication. "They do not take into account that courts often treat electronic information as having the same evidentiary effect as a hardcopy letter signed by the sender," explains Ashish S. Prasad, Partner and Chair of the Electronic Discovery Group of Mayer, Brown, Rowe & Maw LLP.

"Another part of the problem is that courts often regard databases and other shared data areas as highly relevant, but there are substantial complexities and burdens in producing them," adds Mr. Prasad, who develops policies and practices for corporations in the areas of electronic discovery and records management.

As case law evolves, resolution of many issues continues to be determined on an ad hoc basis. To provide consistency and clarity, the Judicial Conference Civil Rules Advisory Committee, chaired by the Honorable Lee H. Rosenthal, U.S. District Judge in Houston, Texas, is proposing a new package of rule amendments governing discovery of electronic information. The full text of the amendments and the Advisory Committee's Report are available at: www.uscourts .gov/rules. These amendments will significantly impact in-house counsel and litigators, so it is crucial to understand the effects of each amendment.

An important amendment to Rule 26(b)(2) applies the "two-tier" structure of the 2000 amendments to discovery of electronic information that should expedite the production of "reasonably accessible" electronic information, while leaving disputes regarding burden, cost, and relevance of other information to resolution by agreement or court order. While strongly supportive of the proposed amendment, Alfred W. Cortese, of Cortese pllc in Washington, DC, recommends that it be clarified to create a presumption of cost shifting where the discovery request is overbroad and seeks marginally relevant discovery.

Procedures for asserting the attorney-client privilege after "inadvertent" production are addressed in the amendment to Rule 26(b)(5). Although defining procedures, the amendment does not set standards for resolving the question.

The amendment to Rule 26(f) requires the parties to discuss issues relating to the preservation of discoverable information. Mr. Cortese notes that this is the first time that a preservation obligation is mentioned in the rules and cautions that "counsel should carefully guard against entry of unnecessary or overly broad preservation orders."

The Committee Note to the amendment to Rule 26(f)(4) (encouraging parties to consider whether a discovery plan should include an agreed order to protect against privilege waiver) suggests that it may be appropriate for parties to enter into voluntary claw-back agreements requiring the parties to return any privileged information inadvertently disclosed. Whitney Adams, General Counsel for Cricket Technologies, cautions that litigators should ensure that any "claw back" procedures are documented as involuntary in order to ensure protection of the privilege against third parties in other litigation.

Many practitioners advocated that the Committee adopt an amendment to Rule 37 to create a safe harbor from sanctions when information becomes unavailable as the result of routine operations of business information systems despite a party having taken reasonable steps to preserve the information, unless there was a willful or reckless violation of a court order in the action. The proposed amendments provide a "narrow safe harbor" under specified circumstances that remain to be clarified during a six month comment period.

The Advisory Committee will hold three hearings on the proposed amendments: on January 12, 2005, in San Francisco, CA; January 28, 2005, in Dallas, TX; and February 11, 2005, in Washington, DC. You can request to testify by sending your request directly to Peter G. McCabe, Secretary of the Committee on Rules of Practice and Procedures, at peter_mccabe@ao.uscourts.gov. When doing so, we are asking our friends to please send a BLIND copy of their request to Barry Bauman at bbauman@lfcj.com. Additionally, one can submit comments by going to www.uscourts.gov and clicking on "Federal Rulemaking," then "Proposed Rules" at the top of the left column, and finally by clicking on "Submit Comments Electronically via E-Mail." And, you can obtain information on the LCJ website at www.lfcj.com. The comment period will close on February 15, 2005 and the Civil Rules Advisory Committee will consider comments and testimony received during the period at its April 2005 meeting to decide whether or not to recommend promulgation of the amendment package.